Litigation: SEC Charges Ex-Director of Investor Relations With Insider Trading

WASHINGTON, Feb. 23 -- The Securities and Exchange Commission issued the following litigation release (No. 1:22-cv-01448; S.D.N.Y. filed Feb. 22, 2022) involving John-Michael Havrilla:

The Securities and Exchange Commission today charged John-Michael Havrilla, a former employee of medical device company PAVmed Inc., for insider trading in advance of the company's April 2020 positive earnings announcement. To settle the charges against him, Havrilla agreed to pay more than $160,000 in civil penalties and consented to a five-year officer-and director-bar and injunctive relief.

The SEC's complaint, filed in federal court in Manhattan, alleges that three days before the April 9, 2020 earnings release, Havrilla, then Director of Investor Relations for PAVmed, received a draft copy of the company's earnings results for the fourth quarter and full year of 2019. The following day, in breach of his duties to PAVmed and its shareholders, Havrilla allegedly purchased 227,500 shares of PAVmed stock. As alleged in the complaint, Havrilla sold these shares after the earnings release, generating profits of $80,115.

The SEC's complaint charges Havrilla with violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Without admitting or denying the complaint's allegations, Havrilla has agreed to the entry of a final judgment that would enjoin him from violations of the charged provisions, impose civil penalties of $160,230, and prohibit him from serving as an officer or director of a public company for five years. The settlement is subject to court approval.

The SEC's investigation was conducted by David C. Austin and Simona K. Suh of the Enforcement Division's Market Abuse Unit and by Cynthia A. Matthews and Elzbieta Wraga of the New York Regional Office. The case has been supervised by Market Abuse Unit Chief, Joseph G. Sansone.